Summary of public section of the SRA Board meeting

The Board considered the revised strategic plan and business plan, and approved it. Remaining adjustments would be dealt with by the Finance and Resources Committee.

The strategic plan sets out four priorities for the SRA:

• To successfully bring in outcomes-focused regulation
• Organisational reform — to become a more effective regulator
• A recognised and respected regulator
• The lead regulator for Alternative Business Structures

The business plan sets out the key activities for the SRA in 2010 against each of the priorities, with a lead Director identified for each.

The plans will be published on the SRA website once signed off.

The Board agreed a number of further decisions in principle about the new fairer fees structure, having considered responses to a third consultation.

The decisions included that there should be a criteria-based transitional fee moderation process. The Board decided there should not be special criteria for firms at least 50 per cent of their turnover through legal aid work, as had originally been proposed. Other decisions included the fee arrangements for new firms and sole practitioners and for splits and mergers. The Board also confirmed the previous decision that a reduction for maternity leave will be the only reduction for the individual fee, but that this will be kept under review in light of the implementation of the Equalities Act or other relevant legislation.

The final amounts for both the individual element of the new fees system (the Practising Certificate fee), and the bandings for the firm-based element, will be set once the SRA and Law Society have agreed the total funding requirement. The final fee determinations must be approved by the Legal Services Board.

The Board agreed to amend rule 4.05, as agreed by the Standards Committee*.

The Board heard that what was proposed was a relatively limited change to the rule on protecting confidential information.

The Standards Committee had previously decided not to go ahead with changes to rule 3.

*This is subject to approval by the Legal Services Board.

The Board confirmed the decisions made in principle at its March meeting, having considered a full Equality Impact Assessment (a draft impact assessment had been considered at the March meeting, and this was updated for the May meeting with additional evidence, including research commissioned by the Law Society, information from qualifying insurers about their approach to equality and further statistics on the ARP).

The Board heard that the number of firms in the ARP had increased dramatically, from 28 in 2007/2008 to 241 in February 2010. The Board's decisions will make limited changes to the ARP aimed at preserving a system of sound financial protection for clients, while maintaining a sustainable competitive market for solicitors' compulsory professional indemnity insurance. The key changes are that 'new firms' will not be able to go straight into the ARP, and the maximum period a firm could be covered will be reduced from 24 to 12 months, but with the SRA able to allow a firm to stay in for a second year, based on objective criteria.

Ways in which the SRA and the Law Society can give better support to firms to avoid the risk of their entering the ARP will also be considered.